AT&T says that nationally its 3G service covers 81 percent of customers and that its dropped call rates are low. It says its geographic coverage isn't indicative of its actual coverage by population in the U.S. And it says its 3G network is improving. (Source: AT&T)

AT&T says its network is very strong, dropped calls are very low

The battle
between Verizon wireless and AT&T over Verizon's ads mocking
AT&T's 3G coverage has been a contentious
one. AT&T took
Verizon to court claiming the ads deceived the customers.
While it lost the first round, being denied
an injunction, AT&T will have another chance to plead its
case at a December 16 hearing.

AT&T's public relations
representative, Seth Bloom (an employee with Fleischman-Hillard),
contacted us, looking to give us his company's views on the debate.
We were happy to get some interesting responses to our questions.
Our dialog is given below:DailyTech: Is
Verizon's map of your 3G coverage incorrect? (I'm talking
specifically about 3G coverage, not misinterpretation.)

SB:They chose geographic coverage. What the maps don't show is that
about 75 percent of Americans - 233 million people - can access AT&T
3G services today where they live and work. AT&T offers 3G
service to roughly 81% of the customers to whom Verizon offers 3G.

DailyTech: Accuracy aside, do you feel the
coverage map is deceiving? Also, as it says 3G coverage, why do you
feel customers won't be able to figure it out, if that's the reason
why you feel it's deceptive?

SB: Yes,
we feel the coverage map is deceptive and independent research has
shown that Verizon's commercials mislead some consumers into thinking
AT&T does not offer any wireless service in a vast area of the
country. In addition to the 75 percent of Americans - 233 million
people - who can access AT&T 3G services today where they live
and work, all of the activities shown in the Verizon television
advertisements can be done on AT&T's 2.5G EDGE network, which is
available to more than 296 million people where they live and work
and across the vast majority of the United States. The ads undermine
the public's confidence in the coverage of AT&T's network and in
how we represent that coverage.

SB:I
can only share national figures. 3G dropped calls are down 12 percent
over the previous year and nearing a 1% level, and 3G blocked calls
(unable to complete on first attempt) are down 30 percent.

(Ed.
Note -We tried to follow up with a second request for more
information, including total
dropped calls, dropped calls on the EDGE networks and dropped call
rates for New York City (or New York state). We also tried to
get an answer whether these studies were conducted internally or
independentally by a contractor. Mr. Fleischman was unable to
provide us with that info, thus its hard to say whether reports of 30
percent dropped call rates on the iPhone in NYC via Apple
representatives at a NYC Genius Bar was accurate. It is clear
though that most
of AT&T's network doesn't have this many dropped calls, though
the exact number remains unclear, based on the limited info
provided.)

DailyTech: What steps
is AT&T taking to upgrade its 3G network?

SB:AT&T invested more than any other U.S. public company in
2008, and plans to spend between $17 and $18 billion this year, with
billions dedicated to the wireless network. AT&T is setting
expectations and standards for the technology community, encouraging
them to develop the more sophisticated hardware, software and
standards to handle the volumes and applications we're seeing on our
wireless network.

The network improvements include
backhaul enhancements that will deliver more bandwidth to thousands
of cell sites this year.

We're also in the midst of an
initiative to substantially expand the wireless spectrum serving 3G
customers in hundreds of markets across the country, using
high-quality 850 MHz spectrum, which expands network capacity and
improves in-building reception. Deployments of this 850 MHz spectrum
are about 90 percent complete today.

We're adding about 2,000 new cell
sites to our network in 2009, expanding service to new cities and
improving coverage in other areas. o We're enabling widespread Wi-Fi
connectivity via the largest hotspot footprint in the country with
more than 20,000 hotspots in all 50 states. Wi-Fi access is
free to qualifying AT&T smartphone and broadband customers,
allowing them to take advantage of the best available AT&T
mobile broadband connection.

We're preparing for field trials of 4G LTE wireless networks
next year, with deployment planned to follow in 2011. This schedule
aligns with industry expectations of when a wide variety of
compatible 4G wireless devices will be available.

DailyTech: Would it be correct to say that
perhaps the wild success of the iPhone and the growth in subscription
(in the U.S.) caught your company a bit off guard, and that may be
one reason for the struggles? If this is true or perhaps partially
true, does this mean that with time these issues will go away as the
high speed (3G) capacity catches up?

SB:The iPhone is an iconic device that has changed how people access
information, and our tremendous success with the iPhone is clearly
driving the data traffic on our network. But keep in mind that the
demand for mobile data bandwidth is also being driven by a wide range
of smartphones and emerging applications and devices, so it wouldn't
be accurate to pin the growth we're seeing today solely on a single
device.

At the same time, it's important to note that we've
maintained the nation's fastest 3G network throughout, and we're
investing heavily and working tirelessly to enhance and expand our
network to stay ahead of demand. (And that demand has been nearly
5,000 percent in the last 12 quarters.)

To answer your
question more directly: Yes, we're seeing strong results from the
network investments that we've made to date and that will continue.
In addition to the improved dropped call rate I mentioned above,
AT&T's 3G reliability is 96.67% and 3G retainability is 98.1%.
(Both are within ½ percentage point of VZ.) Customers are noticing
our efforts. AT&T added more subscribers in 3Q thanVerizon, and
more customers left Verizon than AT&T in the same period. (AT&T:
2M adds, 1.43% churn vs VZ 1.2M adds, 1.49% churn). Our total churn
rate has steadily decreased by 14 percent over the past two years,
while Verizon's has increased by 24 percent over the same period.

DailyTech: If AT&T can't win a decision
to take the ads off the air, what strategies might be employed to
counter the bad publicity? Might AT&T turn to fighting fire with
fire, perhaps picking at lacking aspects of Verizon's network or
phone offerings in new ads?

SB: Our new
ad, which began airing last night, is one way we're doing just
that. We are also continuing to talk
directly to customers. We want customers to know that our 3G
network has unique attributes that Verizon and other competitors
cannot match: AT&T has the fastest 3G network and that it allows
for simultaneous talk and Web surfing. We also talk about our
unrivaled stable of smartphones (not just iPhone) - Bold 9700, Bold
9000, Curve 8900 and other Blackberries; HTC PURE, HTC Tilt 2 - both
running WM 6.5; Nokia E71x & Surge; Garmin nuvifone, and more.
Twice as many smartphone users have chosen AT&T over any other US
carrier.

DailyTech would like to thank Mr. Bloom for
graciously accepting our request for interview and answering the
majority of our inquiries in depth.

"Nowadays you can buy a CPU cheaper than the CPU fan." -- Unnamed AMD executive